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Negotiating Exit Strategy and Dilapidations Settlement: British Telecommunications and Telereal Trillium

Darren Hughes

Representing British Telecommunications (BT) and Telereal Trillium, we were appointed to negotiate a conditional break clause and dilapidations settlement from Grand Island, BT’s North West provincial leasehold building, extending to 100,000 sq ft.

The appointment followed a dilapidations claim in excess of £5 million from the Landlord on the back of BT exercising a conditional break clause, which required all lease covenants to be complied with by the break date.

Dilapidations liability and exit strategy advice

We provided Telereal and BT with an assessment on dilapidations liability and advised on an exit strategy, tendering the works prior to a settlement.

As part of the exit strategy, over 1100 staff was relocated into 16 other BT sites, significantly lowering reducing property and operational costs. The handover was smoothly managed by our team and executed by Telereal and their suppliers.

Savings of £2m on dilapidations and £10m in rental and business rates liability

Darron Hughes, Head of Building consultancy in our Manchester office, said: This was a complex project involving several stakeholders and sites. We successfully negotiated a settlement which saved BT over £2m on the dilapidations and over £10m in rental and business rates liability, as part of a longer cost reduction exercise.”

Successful handover of vacant building

The Grand Island building was handed over to the landlord with full vacant possession, relieving our client of significant potential risk, costs and responsibility.


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